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The federal government approved a plan by Gov. Tom Corbett that provides health coverage to at least 500,000 Medicaid-eligible Pennsylvanians.

Corbett, a Republican trailing in the polls to Democratic challenger Tom Wolf, and the Obama administration, which has been putting pressure on 24 states that didn't expand Medicaid under the president's divisive Affordable Care Act, each claimed victory. Wolf supports the Obama plan.

Corbett said his alternative to expansion allows the state to “reform a financially unsustainable Medicaid program and increase access to health care for eligible individuals through the private market.”

With the compromise, which delays or leaves out a couple of key pieces of Corbett's original proposal, hundreds of thousands of poor, working families will gain access to health insurance.

Anyone making no more than 133 percent of the poverty level — $15,521 for individuals, $31,720 for a family of four — will qualify for coverage, which will be administered by private insurance companies. Sign-ups are expected to begin Dec. 1 for coverage that will take effect Jan. 1.

Terry Madonna, a political science professor at Franklin & Marshall College, called the approval a win for Corbett's re-election campaign, which he said was badly in need of one.

“He needs to begin to show success, and this is an important victory,” Madonna said. “I'm not going to predict if it's enough to win the election. We'll have to see how that plays out.”

Healthy PA continued to face criticism from liberals and conservatives.

State Rep. Angel Cruz of Philadelphia, ranking Democrat on the House committee overseeing human service programs, praised the deal providing coverage to uninsured Pennsylvanians, but said he would “fight for a full acceptance of the Affordable Care Act, not simply the watered-down version Gov. Corbett put forth in February.”

The conservative Commonwealth Foundation commended Corbett for pushing back against Medicaid expansion, but said he should “walk away” from the plan as approved.

“Given the federal government's unwillingness to grant Pennsylvania work search requirements or meaningful cost-sharing, it's in the best interest of Pennsylvanians to walk away and pursue other avenues to truly expand health care access,” the Harrisburg nonprofit said in a statement.

Wolf responded to the approval by saying it was unfortunate that uninsured people in the state lost a year of potential health coverage.

“After standing in the way of Medicaid expansion for years, Tom Corbett has finally been forced by political reality to accept a Medicaid proposal,” he said.

In addition to providing coverage to people who hadn't qualified for Medicaid, Corbett's plan reforms the Medicaid program by reducing the number of available benefit plans to two, down from 14. It will eliminate co-payments for medical services starting in 2016, but will add an $8 payment for non-emergency use of hospital emergency departments.

For recipients whose incomes are more than 100 percent of the poverty level, premium sharing payments will be required starting in 2016, up to 2 percent of their income. They will range from $19.45 to $25.87. Corbett had initially asked for premium payments from all newly eligible recipients, on a sliding scale up to $25 a month.

An earlier proposal that recipients search for work or participate in job training, which Corbett backed away from in March, was not approved by federal officials; however, Corbett will start a separate program to help low-income people find better employment. Recipients will be able to lower their Medicaid premiums by participating in the voluntary program, Corbett said.

Overall, the Healthy PA program is predicted to save the state a total of $4.5 billion over eight years, Corbett said.

The Affordable Care Act originally required all states to expand Medicaid to all uninsured people whose incomes were below the level to qualify for tax credits for purchasing on state or federal exchanges. The state's Medicaid program covers only people whose income is 44 percent of the poverty level and who have certain medical conditions.

The U.S. Supreme Court in June 2012 upheld the law's mandate that virtually all people carry health insurance but made Medicaid expansion optional for states.

The federal government pays 100 percent of the cost for newly eligible Medicaid recipients through 2016, before the funding declines to 90 percent.

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